VILLAGE OF NILES, ILLINOIS OAKTON-WAUKEGAN TAX INCREMENT FINANCE DISTRICT ELIGIBILITY REPORT

Transcription

1 Preliminary Draft 01/29/2018 VILLAGE OF NILES, ILLINOIS OAKTON-WAUKEGAN TAX INCREMENT FINANCE DISTRICT ELIGIBILITY REPORT A study to determine whether all or a portion of an area located in the Village of Niles qualifies as a conservation area as set forth in the definition in the Tax Increment Allocation Redevelopment Act, 65 ILCS 5/ , et seq., as amended. Prepared for: Village of Niles, Illinois Prepared by: Kane, McKenna and Associates, Inc. January, 2018

2 VILLAGE OF NILES, ILLINOIS OAKTON-WAUKEGAN TAX INCREMENT FINANCE DISTRICT ELIGIBILITY REPORT TABLE OF CONTENTS SECTION TITLE PAGE Executive Summary i I. Introduction and Background 1 II. Qualification Criteria 3 III. The Redevelopment Project Area 6 IV. Methodology of Evaluation 7 V. Qualification Factors 8 VI. Summary of Findings 13 Appendix A: Tax Parcels for RPA Appendix B: Boundary Map of RPA

3 EXECUTIVE SUMMARY Kane, McKenna and Associates, Inc. (KMA) has been retained by the Village of Niles (the Village ) to conduct an analysis of the qualification of an area for the establishment of the Oakton-Waukegan Tax Increment Finance (TIF) District. The Village is pursuing the creation of the Oakton-Waukegan TIF District to promote the revitalization of underutilized properties located within the Village and the overall improvement of the Oakton-Waukegan area. In the context of planning for the establishment of the Oakton-Waukegan Tax Increment Financing District (the TIF District, the TIF, Redevelopment Project Area, or RPA ), the Village has initiated the study of parcels within the Oakton- Waukegan area to determine whether they qualify separately or in aggregate under the Tax Increment Allocation Redevelopment Act, 65 ILCS 5/ , et seq., as amended (the TIF Act or Act ) for inclusion in the creation of the TIF District. KMA agreed to undertake the study of the RPA on the Village s behalf. Based upon the analysis completed to date, KMA has reached the following conclusions regarding the potential qualification of the RPA: 1) The area qualifies as a conservation area The RPA qualifies as a conservation area as defined under the TIF Act. The area, in aggregate, is in danger of declining toward a blighted condition due to factors identified in this report. These factors prevent or threaten healthy economic and physical development of the area. The TIF Act states that an area may only qualify as a conservation area if the majority (50% or more) of the structures are 35 years or older. 5 of the 5 structures in the RPA, or 100% of all structures, are over 35 years of age; thus, the RPA meets the statutory criteria for consideration as a conservation area. 2) The current conditions impede redevelopment The existence of certain conditions found within the RPA present a barrier to the area s successful redevelopment. The current conditions in the RPA are impediments to redevelopment, creating an environment where it is reasonable to assume redevelopment would not take place but for the use of the TIF Act. The factors present on the ground negatively impact coordinated and substantial private sector investment in the overall area. Without the use of Village planning and economic development resources to mitigate such factors, potential redevelopment projects (along with other activities that require private sector investment) are not likely to be economically feasible. 3) Viable redevelopment sites could produce incremental revenue Within the RPA, there are several parcels which potentially could be redeveloped and thereby produce incremental property tax revenue. Such revenue, used in combination with other Village resources for redevelopment incentives or public improvements, would likely stimulate private investment and reinvestment in these sites and ultimately throughout the RPA. i

4 4) TIF designation is recommended To mitigate conservation area conditions, promote private sector investment, and foster the economic viability of the RPA, KMA recommends that the Village proceed with the formal TIF designation process for the entire area. The Village will not be considering redevelopment of residential parcels that would displace residential units, and will certify that it will not dislocate 10 or more residential units within the TIF district. Therefore, a housing impact study pursuant to the TIF Act will not be conducted by the Village. ii

5 I. INTRODUCTION AND BACKGROUND The RPA is located in the central portion of the Village in an area traditionally characterized by commercial and institutional uses. The RPA is generally defined as the southwestern, northwestern, and northeastern corners of the intersection of Oakton Street and Waukegan Road. The RPA consists of 15 tax parcels and is approximately 6 acres in size, excluding right of ways. Please see Appendix A for a list of the proposed parcels for inclusion in the TIF District. The intersection of Oakton Street and Waukegan Road is a central feature of the Village. As identified in the Niles 2030 Comprehensive Plan (2011), or the Comprehensive Plan, the area experiences higher than normal average daily traffic. This pattern is partly due to the close proximity of the Village s Civic Center. Despite this advantageous location, many parcels in the RPA demonstrate conditions which deter development and prevent the area from being fully utilized. Village goals include strengthening connections to the RPA. However, without adequate investment, the area will continue to underperform and remain underutilized. Objectives- The Village s general economic development and community development objectives are to enhance commercial and institutional uses within the area, to promote redevelopment in the underused areas, and entice private redevelopment of the RPA to strengthen the Village s tax base while improving the quality of life for residents. Given the Village's objectives as well as the conditions described in this report, the Village has made a determination that it is highly desirable to promote the redevelopment of the underutilized areas of the proposed RPA. Without an implementation plan for redevelopment, Village officials believe adverse conditions will worsen. The Village intends to create and implement such a plan in order to restore, stabilize, and increase the economic base associated with the RPA, which will not only benefit the community as a whole but also generate additional tax revenues to support municipal services. Determination of the But For - The Village has determined that planned redevelopment for the RPA is feasible only with public finance assistance. The creation and utilization of a TIF redevelopment plan and redevelopment agreements are intended by the Village to help provide the assistance required to eliminate conditions detrimental to successful redevelopment of the RPA and to improve the tax base and job creation within the Village. TIF Mechanism- The use of TIF relies upon induced private redevelopment in the RPA to create higher real estate values that would otherwise decline without such investment. By so doing, it would result in increased property taxes compared to the previous land use (and/or absence of use). In this way, the existing tax base for all tax districts would be protected and a portion of future increased taxes pledged to attract the requisite private investment. 1

6 Current Land Use- Current land uses within the RPA are commercial and institutional. The area is zoned for commercial, mixed, and institutional uses. Despite its advantageous location, many parcels in the area are underutilized and face challenges due to changing spatial needs for development and changing standards for commercial and institutional uses. The creation of a TIF District in this area would provide the Village with the opportunity of bringing new development to an area that has become underutilized and has exhibited a relatively high number of vacancies. The RPA suffers from a variety of economic development impediments identified in the TIF Act. Specifically, it experiences deterioration, obsolescence, and lagging or declining equalized assessed valuations (EAV). Section V of this report identifies other impediments to redevelopment. General Scope and Methodology- KMA formally began its analysis by conducting a series of meetings and discussions with Village staff starting in October 2017 and continuing up to the date of this report s issuance. The purpose of the meetings was to establish boundaries for initial analysis and to gather data related to the qualification criteria for parcels included in the RPA. These meetings were complemented by a series of field surveys for the entire area to evaluate the condition of the proposed TIF. KMA made numerous site visits to the area to examine the parcels and the conditions. KMA also utilized the Comprehensive Plan and other Village reports in the analysis. For the purpose of the study, properties within the RPA were examined in the context of the TIF Act governing improved areas (separate provisions of the Act address nonimproved or vacant areas). The qualification factors discussed in this report qualify the area as a conservation area, as the term is defined pursuant to the TIF Act. During the course of its work, KMA reported to key Village staff its findings regarding TIF qualification and feasibility prospects for the area under study. Based on these findings the Village (a) made refinements to the RPA boundaries and (b) directed KMA to complete this report and to move forward with the preparation of a Redevelopment Plan and Project for the RPA. For additional information about KMA s data collection and evaluation methods, refer to Section IV of this report. 2

7 II. QUALIFICATION CRITERIA With the assistance of Village staff, Kane, McKenna and Associates, Inc. assessed the RPA to determine the presence or absence of qualifying factors listed in the TIF Act. The relevant sections of the Act are found below. The Act sets out specific procedures which must be adhered to in designating a RPA/Redevelopment Project Area. By definition, a Redevelopment Project Area is: An area designated by the municipality, which is not less in the aggregate than 1½ acres and in respect to which the municipality has made a finding that there exist conditions which cause the area to be classified as a blighted area or a conservation area, or a combination of both blighted areas and conservation areas. Under the Act, conservation area means any improved area within the boundaries of a Redevelopment Project Area located within the territorial limits of the municipality where certain conditions are met, as identified below. TIF Qualification Factors for a conservation area - In accordance with the Illinois TIF Act, KMA performed a two-step assessment to determine if the RPA would qualify as a conservation area. First, KMA analyzed the threshold factor of age to determine if 50% or more of structures were 35 years of age or older. If a proposed conservation area meets the age threshold, then the following factors are examined to determine TIF qualification: If a conservation area, industrial, commercial and residential buildings or improvements are detrimental to the public safety, health or welfare because of a combination of three or more of the following factors, each of which is (i) present, with that presence documented to a meaningful extent so that a municipality may reasonably find that the factor is clearly present within the intent of the Act and (ii) reasonably distributed throughout the improved part of the Redevelopment Project Area: (A) Dilapidation: An advanced state of disrepair or neglect of necessary repairs to the primary structural components of building or improvements in such a combination that a documented building condition analysis determines that major repair is required or the defects are so serious and so extensive that the buildings must be removed. (B) Obsolescence: The condition or process of falling into disuse. Structures become ill-suited for the original use. 3

8 (C) Deterioration: With respect to buildings, defects including, but not limited to, major defects in the secondary building components such as doors, windows, porches, gutters, downspouts, and fascia. With respect to surface improvements, that the condition of roadways, alleys, curbs, gutters, sidewalks, off-street parking and surface storage areas evidence deterioration, including, but limited to, surface cracking, crumbling, potholes, depressions, loose paving material and weeds protruding through paved surfaces. (D) Presence of Structures Below Minimum Code Standards: All structures that do not meet the standards of zoning, subdivision, building, fire and other governmental codes applicable to property, but not including housing and property maintenance codes. (E) Illegal Use of Individual Structures: The use of structures in violation of applicable federal, State, or local laws, exclusive of those applicable to the presence of structures below minimum code standards. (F) Excessive Vacancies: The presence of buildings that are unoccupied or under-utilized and that represent an adverse influence on the area because of the frequency, extent, or duration of the vacancies. (G) Lack of Ventilation, Light, or Sanitary Facilities: The absence of adequate ventilation for light or air circulation in spaces or rooms without windows, or that require the removal of dust, odor, gas, smoke or other noxious airborne materials. Inadequate natural light and ventilation means the absence of skylights or windows for interior spaces or rooms and improper window sizes and amounts by room area to window area ratios. Inadequate sanitary facilities refers to the absence or inadequacy of garbage storage and enclosure, bathroom facilities, hot water and kitchens and structural inadequacies preventing ingress and egress to and from all rooms and units within a building. (H) Inadequate Utilities: Underground and overhead utilities such as storm sewers and storm drainage, sanitary sewers, water lines and gas, telephone and electrical services that are shown to be inadequate. Inadequate utilities are those that are: (i) of insufficient capacity to serve the uses in the Redevelopment Project Area; (ii) deteriorated, antiquated, obsolete or in disrepair; or (iii) lacking within the Redevelopment Project Area. 4

9 (I) Excessive Land Coverage and Overcrowding of Structures and Community Facilities: The over-intensive use of property and the crowding of buildings and accessory facilities onto a site. Examples of problem conditions warranting the designation of an area as exhibiting excessive land coverage are: (i) the presence of buildings either improperly situated on parcels or located on parcels of inadequate size and shape in relation to present-day standards of development for health and safety and (ii) the presence of multiple buildings on a single parcel. For there to be a finding of excessive land coverage, these parcels must exhibit one or more of the following conditions: insufficient provision for light and air within or around buildings, increased threat of spread of fire due to the close proximity of buildings, lack of adequate or proper access to a public right-of-way, lack of reasonably required off-street parking or inadequate provision for loading service. (J) Deleterious Land-Use or Layout: The existence of incompatible land-use relationships, buildings occupied by inappropriate mixed-uses or uses are considered to be noxious, offensive or unsuitable for the surrounding area. (K) Environmental Clean-Up: The proposed Redevelopment Project Area has incurred Illinois Environmental Protection Agency or United States Environmental Protection Agency remediation costs for (or a study conducted by an independent consultant recognized as having expertise in environmental remediation has determined a need for) the clean-up of hazardous waste, hazardous substances or underground storage tanks required by State or federal law. Any such remediation costs would constitute a material impediment to the development or redevelopment of the Redevelopment Project Area. (L) Lack of Community Planning: The proposed Redevelopment Project Area was developed prior to or without the benefit or guidance of a community plan. This means that the development occurred prior to the adoption by the municipality of a comprehensive or other community plan or that the plan was not followed at the time of the area s development. This factor must be documented by evidence of adverse or incompatible land-use relationships, inadequate street layout, improper subdivision, parcels of inadequate shape and size to meet contemporary development standards or other evidence demonstrating an absence of effective community planning. (M) Lagging or Declining EAV: The total equalized assessed value (EAV) of the proposed Redevelopment Project Area has declined for three (3) of the last five (5) calendar years prior to the year in which the Redevelopment Project Area is designated, or is increasing at an annual rate that is less than the balance of the municipality for three (3) of the last five (5) calendar years, for which information is available or increasing at an annual rate that is less than the Consumer Price Index for All Urban Consumers published by the United States Department of Labor or successor agency for three (3) of the last five (5) calendar years prior to the year in which the Redevelopment Project Area is designated. 5

10 III. THE REDEVELOPMENT PROJECT AREA The RPA contains 15 tax parcels located within the boundaries of the area. The RPA is approximately 6 acres in size, excluding right of ways. The RPA contains improved land designated primarily for commercial, mixed, and institutional purposes. The area s potential for redevelopment is challenged due to the age of improvements. The area has the potential to be a significant asset to the Village but requires adequate reinvestment to achieve this status. In the Comprehensive Plan, the Village identifies economic development as a top priority and Tax Increment Financing as a possible tool for encouraging redevelopment. The Comprehensive Plan identifies the RPA as an important node in the community and encourages its development as an asset to the Village. However, the current state of the RPA deters reinvestment and limits the area s potential for growth. Some characteristics of the RPA which evidence barriers to reinvestment include deteriorating surface improvements, poorly implemented ingress/egress points, and inadequate maintenance of commercial structures. The close proximity of the Village s Civic Center and its location along a heavily trafficked thoroughfare provide a unique opportunity for the Village, but without appropriate investment, the RPA will continue to leave this opportunity unrealized. 6

11 IV. METHODOLOGY OF EVALUATION The RPA was examined to assess the applicability of the different factors required for qualification for TIF designation under the Act. Data collected from the RPA, Village and Cook County and used to determine relevance and severity of conditions compared against the statutory factors. Land and buildings within the RPA were examined to determine the applicability of the 13 different factors for qualification for TIF designation under the Act. The following steps were undertaken in this process: 1) Site visits to the RPA were undertaken by representatives from KMA. These site visits required the area to be walked multiple times by the same team while taking notes, filling out site surveys and taking photographs. The purpose of these site visits included parcel counts, address matches, current land uses, building conditions, lot conditions, and traffic flow. KMA documented the area s conditions through site surveys, notes and photography. Site surveys were completed for each parcel within the RPA. 2) To determine if the area qualified as a conservation area the age of the buildings were ascertained by matching site surveys to Cook County tax and building records. 3) KMA conducted evaluations of exterior structures and associated site improvements, noting such conditions relevant to the qualifying factors on the site surveys. 4) KMA reviewed the tax information from Cook County, parcel tax maps, site data, local history (discussions with Village staff) for an evaluation of area-wide factors that have affected the area's development to determine the presence of qualifying factors. 5) KMA performed EAV trend analysis to ascertain whether EAV growth in the RPA underperformed relative to EAV growth in the balance of the Village and the Consumer Price Index-All Urban Consumers. 7

12 V. QUALIFICATION FINDINGS FOR RPA Based upon KMA s evaluation of parcels in the RPA and analysis of each of the eligibility factors summarized in Section II, the following factors are presented to support qualification of the RPA as a conservation area. These factors are summarized in Table 1 below. These factors are found to be clearly present and reasonably distributed throughout the RPA, as required under the Act. Table 1 Summary of Conservation Area Findings Maximum Minimum Possible Factors Needed Factors per to Qualify per Statute Statute Qualifying Factors Present in RPA Lagging or Declining EAV Deterioration Obsolescence Lack of Community Planning Excessive Vacancies Inadequate Utilities Note: In addition to 6 qualifying factors above, the RPA meets the statutory age threshold that 50% or more of the structures are 35 years or older. Finding as a conservation area - The RPA is found to qualify as a conservation area under the statutory criteria set forth in the TIF Act. As indicated in Section II, KMA performed a two-step assessment, first finding that 50% or more of structures within the conservation area were over 35 years of age. Based upon Cook County Assessor and site survey data, 5 of 5 structures or 100% were over 35 years in age, please see Table 2 below. Table 2 Conservation Area Findings Total Number of Buildings in RPA 5 Total Number of Buildings 35yrs+ 5 Percentage of Buildings 35yrs+ 100% 8

13 Conservation area factors- As a second step, KMA reviewed the criteria needed to qualify an area as a conservation area, finding that six factors were present: 1) Lagging or Declining EAV: This factor is present if the total equalized assessed value (EAV) of the proposed Redevelopment Project Area has declined for three (3) of the last five (5) calendar years prior to the year in which the Redevelopment Project Area is designated, or is increasing at an annual rate that is less than the balance of the municipality for three (3) of the last five (5) calendar years, or increasing at an annual rate that is less than the Consumer Price Index for All Urban Consumers published by the United States Department of Labor or successor agency for three (3) of the last five (5) calendar years prior to the year in which the Redevelopment Project Area is designated. The RPA qualifies under two of these measurements. Please see Table 3 on for a breakout of the detailed numbers. The RPA s EAV has declined for three (3) of the last five (5) years, only showing growth in 2014 and The RPA s EAV also lagged behind the CPI-U (Consumer Price Index-All Urban Consumers) for three (3) of the last five (5) five years. Just one of these quantitative measurements would qualify for this category under the TIF Act but the RPA s qualification under two categories highlights its particular trouble maintaining growth since Table 3 EAV Trends for Proposed TIF District Total EAV for $3,142,648 $2,838,693 $4,249,370 $3,314,562 $3,477,842 $3,688,405 Proposed TIF District EAV Change (%) 10.71% % 28.20% -4.69% Village with EAV $1,233,377,215 $1,062,438,260 $1,101,315,741 $1,085,638,897 $1,263,087,619 $1,366,986,836 (Excluding TIF) Village EAV 16.09% -3.53% 1.44% % % - Change (%) CPI- All Urban Consumers 1.30% 0.10% 1.60% 1.50% 2.10% - Source: Cook County Clerk, Cook County Assessor & U.S. Census Bureau 2) Deterioration: The Act defines deterioration as the physical decline of surface improvements, primary building components, and secondary buildings components such as doors, windows, porches or gutters. With respect to surface improvements, deterioration is determined by the condition of roadways, alleys, curbs, gutters, sidewalks, off-street parking and surface storage areas (including but not limited to surface cracking, crumbling, potholes, depressions, loose paving material and weeds protruding through paved surfaces). In the RPA, deterioration was observed in the majority of parcels. Deterioration was primarily observed among the surface improvements. Parking lots adjacent 9

14 to both vacant and occupied structures have widespread cracking as well as potholes and depressions. Weeds were found to be present between cracks for many of the surface improvements, leading to an adverse aesthetic effect to nearby businesses. Because parking lots constitute a large percentage of overall land use in the RPA, the poorly maintained lots have an overall negative aesthetic impact on the area. Deterioration is also present in the secondary building components such as doors, windows, gutters, and fasciae. Furthermore, some buildings exhibit deterioration in the brickwork and exhibit the need for new tuck-pointing. Exposed electrical work from vacant signage was found to be present in certain cases. Secondary evidence of deterioration was also observed among certain buildings, such as in vacant properties and in the rear portions of some occupied buildings. 3) Obsolescence: The Act states that obsolescence is the condition or process of falling into disuse or structures that have become ill-suited for their original use. The area exhibits both economic and functional obsolescence. The RPA exhibits area-wide obsolescence in need of investment and redevelopment for attracting new tenants. The onset of obsolescence can be measured through qualitative and quantitative means. Building age, EAV, deterioration in buildings and lots, traffic flows, infrastructure and vacancy rates can signify obsolescence as proxies. By these measures the RPA is exhibiting obsolescence. In general the RPA has seen a substantial loss in value in the last five years. Between tax years 2011 and 2016 the area wide valuation fell by approximately 5%. This report identifies, the RPA s building age, lagging EAV, deterioration, and high rates of vacancy as evidence of obsolescence. This report also identifies inadequate infrastructure and outdated improvements as evidence of obsolescence. From a qualitative perspective, many of the structures exhibit design features or components that are outdated in relation to market conditions. Signage, façade and exterior treatments, and site improvements in many cases are dated and appear outmoded in relation to newer properties. Significant deterioration of site improvements or building components also contributes to the outmoded or tired appearance of many structures and facilities. Excessive vacancies have contributed to this deferred maintenance. The majority of commercial improvements are underparked by conventional standards, contributing to overall obsolescence and desirability of the RPA. The Village Engineering Department has identified portions of both Oakton Street and Waukegan Road that fall within the RPA as being in poor condition. Both routes have a roughness rating of Not Acceptable. Additionally, the Village has identified the intersection of Oakton Street and Waukegan Road as being in need of streetscape improvements. The poor condition of these streets contributes to the obsolescence of the RPA. 10

15 Overall, the physical restrictions of the outdated buildings, the poorly planned or deteriorating infrastructure, and the deferred maintenance to structures has resulted in fewer opportunities for area establishments to remain competitive in comparison to alternative locations. This puts pressure on the remaining tenants to seek opportunities elsewhere. These factors in aggregate make a compelling case for the qualification of the area for the obsolescence factor. 4) Lack of Community Planning: The Act states that if the proposed Redevelopment Project Area was developed prior to or without the benefit or guidance of a community plan the factor is present. This factor must be documented by evidence of adverse or incompatible land-use relationships, inadequate street layout, improper subdivision, parcels of inadequate shape and size to meet contemporary development standards or other evidence demonstrating an absence of effective community planning. The Village published its first Comprehensive Plan in However, most of the RPA was already developed by the time the planning process started. In the RPA, 5 of the 5 buildings, or 100%, were built before Table 4 Buildings Pre-Comp Plan Total Number of Buildings in RPA 5 Total Number of buildings which pre-date 1972 Comp Plan 5 Percentage of Buildings pre-date Comp Plan 100% Much of the development that has occurred within the RPA took place in an era prior to modern community planning techniques, and/or occurred under a lack of comprehensive and coordinated planning. The area lacks many of the modern hallmarks of community planning that the rest of the Village enjoys. An easily identifiable characteristic of the area is the close proximity of differing uses in the area. Residential properties share contiguous parcel borders with all commercially zoned parcels in the RPA. In most cases, little to no screening is present to separate uses. Ingress and egress points are insufficient to support adequate traffic flow. Commercially zoned parcels vary widely in size and features. There is an easily discernable imbalance of available parking among parcels, and the majority of commercial improvements are underparked by conventional standards. Many parcels are incompatible with current development standards due to size and layout. The 1972 Comprehensive Plan, though a step in the right direction, did not guide development in the RPA beyond the established zoning. The Niles

16 Comprehensive Plan states that the 1972 Comprehensive Plan is out of date because of its age and the changes that have occurred both within Niles and the rest of the country since that time, a new vision and associated goals and objectives are necessary to help guide the community (p.7, Village of Niles Synthesis Report). This is not to say that improvements did not take place over the years, but that they were implemented without the guidance of an updated and modern master plan directed toward long-term benefit for the RPA. A lack of such efforts has contributed to the evolution of factors currently present within the RPA. 5) Excessive Vacancies: The Act identifies excessive vacancies as the presence of buildings that are unoccupied or under-utilized which exert an adverse influence on the area due to the frequency, extent, or duration of the vacancies. The RPA exhibits excessive vacancies. All four of the commercial improvements within the RPA were found to be at least partially vacant at the time of survey. Overall, approximately 50% of all commercial square footage within the RPA was found to be vacant. Review of publically available documents indicated the extent of this overall vacancy has persisted for some years. A lack of signage and use of window coverings and for lease signs pronounced the extent of vacancy in the area. This persisting high rate of vacancy contributes to the RPA s desirability and qualifies the RPA for excessive vacancies. 6) Inadequate Utilities: This factor is present if underground and overhead utilities such as storm sewers and storm drainage, sanitary sewers, water lines and gas, telephone and electric services that are shown to be inadequate. Inadequate utilities are those that are: (i) of insufficient capacity to serve the uses in the Redevelopment Project Area; (ii) deteriorated, antiquated, obsolete or in disrepair; or (iii) lacking within the Redevelopment Project Area. The Village Engineering Department states that the water main within the RPA is antiquated and in poor condition. The department notes that the water main requires replacement. This high degree of deterioration qualifies the water system as inadequate. 12

17 VI. SUMMARY OF FINDINGS / GENERAL ASSESSMENT OF QUALIFICATION The following is a summary of relevant qualification findings as it relates to the Village s potential designation of the RPA. 1. The area is contiguous and is greater than 1½ acres in size; 2. The proposed RPA will qualify as a conservation area. Further, the Conservation area factors found in the RPA are present to a meaningful extent and are distributed throughout the area. A more detailed analysis of the qualification findings is outlined in Section V of this report; 3. All property in the area would substantially benefit by the proposed redevelopment project improvements; 4. The sound growth of taxing districts applicable to the area, including the Village, has been impaired by the factors found present in the area; and 5. The area would not be subject to redevelopment without the investment of public funds, including property tax increments. In the judgment of KMA, these findings provide the Village with sufficient justification to consider designation of the RPA. 13

18 APPENDIX A Tax Parcels for RPA

19 APPENDIX B Boundary Map of RPA